Social Security is always being raided. And some brave person – typically an elected official or someone aspiring to be – is always vowing to stop this outrage before our retirement system is drained to the dregs. That’s just how it is in mad-as-hell America, where righteous indignation comes slickly packaged and accurately defining one’s terms is an unnecessary formality.

“Don’t raid Social Security to reduce nation’s deficit,” pleads the AARP. Meanwhile, right-wing gold bugs are warning us that a “huge pot of U.S. Social Security money” is “vulnerable to being tapped by illegal alien workers.” And over on Capitol Hill, intrepid Sen. Jim DeMint promotes a “Stop the Raid” amendment, protesting that “It’s time for politicians to stop stealing from our seniors to secretly finance trillions in wasteful Washington spending.”

The Great Social Security Raid has become the Sasquatch of American politics: the creature that’s always out there but never clearly seen, the monster just under our noses or just beyond our field of vision. We think we know it’s there. But everyone uses the same word to describe something different.

Let’s see if we can chase this thing down. First of all, no one talked about a “raid” until the trust funds began to grow into a substantial amount pool of assets following the 1983 Amendments to the Social Security Act. Critics then began to complain that the trust funds had been “raided” because after using most of our payroll taxes to pay benefits to the current crop of retirees, survivors, and disabled, the Treasury Department borrows the remainder to use for whatever else it damn well pleases, sticking workers with a fistful – actually, a file cabinet-ful – of IOUs.

Another way to look at the transaction, however, is that the Social Security trust funds use the money left over after benefits are paid to buy Treasury bonds. Either the “assets” in the trust funds are worthless chits, or they are the safest investment in the world. But the excess tax revenues have to be invested in something.

Critics of Social Security like to point out that the Treasuries in the Social Security trust funds aren’t like the ones individuals or the Bank of Japan buy, because they’re not negotiable. The trustees can’t turn around and sell them to some other investor. Effectively, one part of the federal government – the Social Security system – has made a loan to another part – the Treasury. That’s not “real” investment, that’s a shell game. Or, stretching the definition, a raid.

The problem is that the commitments behind those Treasury bonds are legally just as enforceable as the ones that trade on the open market. Social Security receives interest on them. As soon as Social Security needs the money back to pay some of the benefits it owes, the Treasury is obliged to redeem them at full value (it’s been doing so this year, in fact, since the recession pushed payroll tax collections below the level needed to pay all current benefits). To not do so would be just as serious a legal breach as to change the terms of the deal on the bonds in the Bank of Japan’s vaults. Until that happens, there’s been no raid.

Often, what the critics really mean when they talk about a Social Security “raid” isn’t that something’s been stolen, but that they don’t like how those payroll taxes receipts have been invested. Safe and sound as they may be, Treasuries aren’t “real” investments, which would be in private-sector instruments like stocks and corporate bonds. But according to the critics, if the assets are to be invested in private-company securities, this shouldn’t be done through the trust funds, which are ultimately controlled by the presidential appointees on the Social Security’s board of trustees. As Alan Greenspan once put it, “even with Herculean efforts, I doubt it would be feasible to insulate, over the long run, the trust funds from political pressures.”

So here we have yet another form of “raid”: a culture of corruption growing up around the trust fund’s investments. The only way to prevent it, according to free market fans, is to give individual workers the right to investment some portion of their payroll taxes in the form of private accounts. The raid can only be stopped, in other words, if the money is given back to the people who paid it in.

But wouldn’t that lead to yet another kind of raid? Most privatization proposals wouldn’t actually give the people their money back. They’d be given a the choice of allocating their payroll tax dollars between a select group of investment vehicles, all run by prominent financial services firms. Is the purpose here to help working people earn a higher return on their investments? Or is it to prop up an overvalued stock market – and provide Wall Street with the steady, fee-based incomes it needs to cushion its high-stakes gambling – er, trading – desks? If the latter, who’s doing the raiding?

OK, let’s get realistic. If by “raid” we simply mean that Washington has been able to “use” our payroll taxes for something other than supporting Social Security, then there might be a case to be made. The Reagan administration famously used the hike in payroll tax receipts in the 1980s – which was already scheduled in the 1977 Amendments, Reagan and Congress just moved the dates up – to compensate for the tax cuts he’d pushed through in 1981, and which had ballooned the deficit. Since then, ordinary workers’ payroll taxes have essentially be used to pay for tax cuts for the affluent.

But even this stretches the definition of a “raid.” Those payroll taxes are still used to purchase Treasury bonds. It’s the proceeds from these that cushion the federal budget from the impact of income tax cuts for the upscale. They could be used for something else – education, green energy initiatives, anti-poverty programs, etc. – and the Treasuries in the trust funds still have to be redeemed. If the trust funds are going to invest in Treasuries, Congress is going to do something with that money. It’s not going to sit on it.

The real discussion, then, needs to be about whether Congress is using the proceeds from those Treasury in ways actually help the economy to grow. But this is never really addressed in the Discourse of the Raid, which most often obscures the fact that the assets in the trust funds have been invested, not stolen. Social Security – and the pool of assets that supports it – are the property of the working Americans who pay into it. Do we want our money to be invested in tax cuts for the holders of capital? wars in the Mideast? charter schools? health care?

As long as the Treasuries in the trust funds are redeemed – as long as the federal government honors the covenants behind the bonds – there’s no raid. Except, perhaps, for one thing:

Suppose Congress decides to cut Social Security benefits. Cutting benefits, absent a corresponding cut in payroll tax rates, would mean that less of the trust fund assets are needed to pay benefits. That would lower the required rate of redemption on those Treasury bonds. And that would mean more of the money from those bonds stays in the hands of Congress for a longer period of time to spend as it pleases.

That would be playing fast-and-loose with the social compact represented by the Social Security trust funds. Workers who had paid into the system for years under one set of expectations could now look forward to getting much less for their money. And that, in a sense, would be a raid.

It is always interesting when politicians and the business news media start telling us what constitutes a Ponzi scheme. The more recent kid on the block is Social Security. We are told that Social Security, which has a Trust Fund with $2.5 Trillion Dollars of U.S. Treasury securities.

The best, brightest, and greediest are demanding extending full Social Security retirement age to 70, and subjecting all Social Security retirees to means testing; i.e. reducing or eliminating retirement income because the person has other resources. This would allow them to reduce the redemption of U.S. Treasury securities held by the Social Security Trust Fund to pay benefits.

They don’t propose returning the Social Security payroll taxes that have been paid to date, or reducing them for employers and employees still paying payroll taxes; the simply propose delaying, reducing, or ending retirement benefits. Sounds like Bernie Madoff.

Of course, they tell us the $4 Trillion Dollars of U.S. Securities held by foreign countries, including communist China and Saudi Arabia, is not a Ponzi scheme.

The politicians and media pundits are confused about Ponzi schemes. We have politicians and media pundits telling us that the surplus Social Security payroll tax contributions from more than 150-million employees and employers that are invested in U.S. Treasury securities (as mandated by Federal laws passed by Congress) are a Ponzi scheme. The payroll taxes have been paying for the Social Security retirement benefits for the last seventy-five years.

Congress takes the excess payroll taxes not required to actually pay retirement benefits, uses the proceeds for anything to pay for ongoing (non-Social Security retirement) expenses, and issues U.S. Treasury securities to the Social Security Trust Fund. The $2.539 Trillion Dollars of surplus payroll taxes represents the funding to be used to provide retirement benefits to those who have not reached retirement age.

A real Ponzi scheme is the sale of Trillions of dollars of worthless collateralized debt obligation and collateralized mortgage obligation securities sold around the world by the American financial services sector investment banks and brokerage firms, including Goldman Sachs, Lehman Brothers, and Merrill Lynch. Our politicians and Federal regulators had the credit rating agencies, including Moody’s, bless them with the Triple-A credit rating to ensure that they could and would be purchased by unsuspecting institutional investors, including many pension funds, and personal investors.

Another real Ponzi scheme was the sale of approximately $700 Trillion Dollars of credit default swaps with no money backing them all around the world by the American U.S. Financial Services sector with the blessing of U.S. politicians and lax Federal regulators.

No one seems to ask the politicians, Wall Street, or the business media pundits why they don’t want the Social Security Trust Fund to redeem any of the $2.5 Trillion Dollars U.S. Treasuries, but are perfectly happy redeeming the $4 Trillion Dollars of U.S. Treasuries held by foreign countries, including communist China and Saudi Arabian oil princes.

No one seems to ask the politicians, Wall Street, or the business media pundits why the American taxpayers, including individuals and businesses should not pay the taxes we need to provide the Liberty and services we demand.

In short, the Ponzi scheme is not Social Security; it is Republican politicians, lax Federal regulations and regulators, the American financial services sector, financial media pundits, and a short-sighted, penny-pinching group of individuals and organizations who are willing to take the benefits of Liberty without contributing anything to the costs of getting the job done.

Is it true that the $$ borrowed from the Trust Fund is NOT counted in the budget? In other words the govt. is understating the actual budget deficit by the amount borrowed from the Trust Fund. If true, then most of our politicians don’t seem to know this.
bob brown

This is a travesty of the reason SOcial Security was started in the first place. It was designed to be a safety net, for all the people paying into the fund, so they could retire in dignity and be able to live frugally, while not being a burden on our economy.

The way COngress has used this fund as their personal piggy bank, is nothing short of criminal.

I would like to respectfully disagree. The Social Security trust fund has indeed been raided.

I apologize for the length of my response; here is the evidence:

When the Social Security system was set up in 1935, the Trust Fund was supposed to be held “in trust” — literally – by the government for America’s citizens, because FDR was concerned about American citizens actually holding their savings until retirement (Source: David Gergen article entitled “How Much Government?”, 2010). Government was going to hold it for them.

Mr Gergen continues,

“FDR, ever the master, came up with an ingenious solution: create a program in which Americans would be asked to contribute to a social savings account that government would manage on their behalf and would be there for retirement. Instead of big government, it was to be a partnership that would encourage individual thrift and responsibility.”

Over the past 65 years, American taxpayers have paid FICA taxes. A large amount of that FICA revenue has gone to pay monthly Social Security benefits (in real-time), but a fair amount of the revenue has been above the immediate needs to pay benefits, and has accumulated as a Social Security surplus. By law, the surplus must be invested in special U.S. Treasury securities.

That Social Security surplus totals $2.5 trillion.

In 1969, in an agreement between Lyndon Johnson, Richard Nixon, and the 1969 Congress, the Social Security trust fund was brought “on budget” for the first time, allowing it to be spent for other government programs (Source: the Social Security Administration website; see Agency History). The reason was to turn an $8 billion deficit into a balanced budget.

The surplus has been spent since 1969 on non-Social Security programs, in its entirety. In its place are $2.5 trillion in Treasury Securities – IOUs, essentially. This is the raiding of the Social Security trust fund.

Here’s the rub: those IOUs can only be paid back from future borrowing or with future taxes.

The first $2.5 trillion were the original FICA taxes that generated the Social Security surplus; the second $2.5 trillion will be the future taxes to redeem the U.S. Treasury Securities.

Try to imagine what $2.5 trillion over the next 40 years would look like, as taxes not enacted. That’s $100 billion a year in the hands of households – for consumption and college savings and personal debt reduction and retirement savings – and in the hands of businesses, for plant expansion, new hires, pay raises and promotions, bonuses, marketing campaigns, sales promotions, research, product development, and capital projects.

That’s the competitiveness of the U.S. economy relative to other countries.

In a private retirement account, any account manager who used someone’s retirement fund for other than its intended purpose would be violating fiduciary responsibility, and his actions would be legally actionable by regulators.

Had the $2.5 trillion surplus indeed been held in trust, much of the current discussion about lowering benefits and raising the retirement age would be unnecessary, and there would be little discussion about pending insolvency of the Social Security system.

In late 2010, Mr Schwarzenegger tried to borrow $2 billion from CalPERS, California’s massive, $220 billion public employee retirement fund, to help address California’s perennial budget shortfall, with a promise that it would be a one-time event, and that government would gradually pay it back.

I’m not sure whom he was trying to kid. The state of California does not have any money – only the taxpayers do. “Government will pay it back” really means “future taxpayers will pay it back”.

In this sense, his attempt to “borrow” from the CalPERS trust fund was no different from the federal government “borrowing” from the Social Security trust fund, and leaving IOUs that can only be redeemed by future taxpayers.

By the way, CalPERS management told him “no”.

CalPERS does invest in the U.S. stock market, to generate some of the earnings that are used to pay benefits. The return they use to calculate growth of the CalPERS fund recently has been reduced from 8% to around 7.75%, to reflect the realities of the current market.

As an aside, the average return on the U.S. stock market over the past 40 years is 8.11%, and over the past 100 years it is 6.29%. I’ll let someone else do the math on what $2.5 trillion might look like had it been invested with those returns.

One could make the argument that investing in the market would put government in the position of picking winners and losers. However, CalPERS currently does so, and I suspect other states’ public employee pension funds do so as well.

There have been two articles within the past year suggesting that government be allowed to borrow from citizens’ private retirement accounts. Fortunately, the proposals have not gone anywhere, at least not yet.

I submit – the Social Security Trust Fund has indeed been raided, and as a result, America’s taxpayers will pay $5 trillion to provide $2.5 trillion in Social Security benefits.

There will never, ever be enough tax revenue to satisfy the political appetite. And Al Gore was right about the Lock-box.

All of this sounds quite complicated. After reading it about three times it seems clearer. The problem is most people won’t spend the time to read and understand. Isn’t there a way to show all of this graphiclally in order to make it easier to understand by the common man?

If the government ran no deficits like it should, where would all the collected social security money go? Into the private sector I suspect, which would be good for the economy. As it is now, the surplus in social security (if there is one anymore), just papers over the government’s insatiable deficit spending. And gives us a crummy return vs, the private sector.

I totally agree with James Schaefer……the politicians have been illegally and criminally raiding the Social Security Trust Fund for many, many years.

I would also add that all along this was all part of a Republican party scheme to prevent raising taxes on the rich and the big corporations (hence big companies like GE pay not only pay zero taxes but they also get back billions in tax credits) while at the same time funding their pork spending projects.

And now here we are in 2011 and instead of finally doing the right thing to put back the money they stole from the Trust Fund, they are instead trying to slowly but surely destroy Social Security. First they’ll start with cutting benefits and extending the retirement age and later on they’ll come up with other ways until seniors will be left with almost nothing.

Yet I am amazed at the lack of widespread outrage and condemnation over the entire theft of our own SS Trust Fund. I recall about 25 years ago when I first realized the raid was starting and some watchdogs sounded the alarms, there was very little public interest. What a huge mistake that was.

And worse, none of our political leaders, from either party has the ethics, morals, and character to do the right thing.

It’s time for an American Revolution II. Washington is owned, run, and controlled by the special interests…….the rich, the big corporations, banks, insurance companies, and the big oil companies. They are destroying the middle class for their own financial gain and their GREED. Wake up America, they’re stealing our country. We are allowing 3% of the population to get away with the destruction of our country.

Thank you for your responses to my post. I have a couple of items of clarification.

The Social Security website states that the government actually pays interest on the trust fund. It is currently around 4.62%, and I believe it does fluctuate somewhat. Of course, that interest is paid by taxpayers (you and me, and small mom-and-pop businesses, and medium and large companies).

Second item is a major correction of my original interpretation, but not of the underlying facts: the Treasuries that make up the Social Security trust fund have always been available to the rest of government for spending on other programs, since the inception of Social Security in 1935. They’re Treasuries, after all.

What changed in 1969 was how the Social Security surplus was recorded: starting in 1969, FICA revenue was included with general tax revenue as part of the overall federal budget (called the “Unified Budget”); as stated above, it turned a budget deficit into an apparent surplus. This information is public domain, available on the Social Security website, under Agency History.

The 1960s, of course, was at a time when the U.S. was much more fiscally conservative; every American citizen had parents who grew up during the depression, and grandparents who were born at the turn of the century (i.e., the last century, 1900). We were told constantly, Live below your means.

Our parents and grandparents knew what it meant to go hungry, and they had heard first-hand stories from their grandparents, who remembered the 1800s – in general, life before any of the creature comforts we have today.

We in this country have much to be thankful for – a Constitution that guarantees rights that cannot be taken away by a vote of the people; and freedoms that people around the world yearn for. We should remember that over 90% of the world would trade places with any of us, in a heartbeat.

Letter in the Wall Street Journal last year: “In the end, the fiscally prudent will own the fiscally profligate.” This is a lesson for all of us.

It applies equally to households, businesses, and governments, and all three groups need to clearly understand the difference between what we need and what we want.

Mr Schaefer. You are confusing and needlessly alarming people with your statements about the SS Trust Fund raid. As you correctly state, excess fica taxes are by law invested in government securities. These funds have then become general revenue funds and expended by Treasury for whatever purpose needed. When the Trust Fund redeems these securities the money does indeed come from our taxes, but this does not constitute paying double. It might be less confusing to consider what would happen if the fica taxes were left in a “lock box.” In that case Treasury would use our taxes to pay for whatever it would have used the borrowed trust fund for. In your example of 2.5 trillion, we have paid that amount into the trust fund and also paid 2.5 trilliion in taxes for some other govt expenditure.We taxpayers would be out the same amounts for the same purposes in either case.
I’m not sure how this issue ever got so confused. I suspect your correct statements about comingling the funds for budget purposes may hsve contributed some. That was a mistake and ought to be rectified asap.
Bill

Mr. Schaefer, I respectfully disagree about several of your points, which I don’t think are supported by the facts. First, the status of the trust funds vis-a-vis the budget. From the beginning of the Social Security program, its transactions were reported by the administration as a separate function in the budget. Thus, the Social Security program was “off-budget,” and remained so from its creation in 1935 until 1968. In early 1968, President Johnson made a change in the budget presentation by including Social Security and all other trust funds in a”unified budget.” This is sometimes described by saying that Social Security was placed “on-budget.” In the 1983 Social Security Amendments, a provision was included mandating that Social Security be taken “off-budget” starting in FY 1985. This was due to a recommendation from the National Commission on Social Security Reform (aka the Greenspan Commission). Their report argued: “… that changes in the Social Security program should be made only for programmatic reasons, and not for purposes of balancing the budget,” and that this policy would be more likely to be carried out if the Social Security program were not in the unified budget. The 1983 Amendments provided that the Social Security and Medicare Trust Funds would be treated as separate budget functions (i.e., off-budget) starting with the 1985 fiscal year, and, beginning with fiscal year 1993, the Social Security Trust Fund was not only off-budget, but it was exempted from any general budget reductions that otherwise might apply to the entire budget (such as an across-the-board cut). Specifically, present law mandates that the Social Security Trust Fund is formally considered to be “off-budget” and no longer part of the unified federal budget.

Second, when you say that repaying Social Security for the money it lent to the general fund by redeeming the bonds in the trust funds will “add to the deficit,” you are incorrect. All it would actually do is shift the debt on the balance sheet from being owed to Social Security to being owed to someone else. Currently the Social Security Trust Fund owns $2.6 trillion of the national debt, in the form of treasury securities. Now, when the trust fund goes to collect, if the government doesn’t raise the current revenue to repay it, they will have to borrow it, but it’s already borrowed! It’s like if I loan you $10, and then next week I come to you and say, “hey, I need my $10,” and you say, “I don’t have it,” and I say “well get it,” so you borrow $10 from someone else to pay me. You aren’t now $20 in debt, you are still only $10 in debt, you just owe it to a different person. Same here, so Social Security can never add to the debt. All that repaying the Trust Fund can do is force us to REFINANCE the debt, not double it!

Can you imagine what our society would be like if we the average Americans dealt with our finances (and those for people for whom we work) the way our government has handled social security funds? And what would society be like if we failed to keep our individual commitments, the way certain individuals in the political arena propose to deal with those of us who have paid into social security for much of our lives? Certainly it doesn’t put forth a very good example to people, for example, who are struggling away to pay off debt on a home mortgage that has far distanced the current worth of the home–why not just walk away from the debt?

I’m getting dizzy from the spin! What nonsense! The bonds purchased by SS can be redeemed any time they want, hunh? And how will they be redeemed? By billing the taxpayers (or by printing more money, which will cause inflation, which will cost the next generation.) This scam was an advance on raising the next generation’s taxes, plain and simple.

It’s true that the bonds will have to be redeemed through additional tax revenue. However, the crucial point that people often miss is that who the US tax revenue comes from two primary sources, the income tax and the payroll tax, the rich pay most of the income tax and the middle class pay most of the payroll tax (in fact most American’s pay more in the payroll tax than the income tax).

Since the trust fund has been paid mostly by the middle class through payroll increases in the 80s while the rich were given income tax cuts that means the only fair solution is to raise income taxes which effect the rich more than the middle class.

No easy answer to this one. At various times, the pioneers of Social Security entertained the idea that more of the cash flow should be replaced by income tax over time. But by the early 90s, with the program under constant attack, the fact that it was self-financing emerged as one of its first lines of defense, at least rhetorically. So the idea is rarely revived either by friends of Social Security or by its critics (who mostly want to dismantle it anyway). The one promising solution that has arisen in recent years is to raise the cap on the portion of income that’s subject to payroll tax. This would remove a chunk of the program’s projected long-term deficit at a stroke. It would also make Social Security more equitable, since the extra revenue would all come from people making over $113,000 a year. Even if this isn’t done, however, there’s something else that’s important to keep in mind: The earned-income tax credit offsets much if not all of the regressive effects of the payroll tax, since it goes to people who predominantly pay payroll tax but no income tax. So by and large, there’s no regressive wealth transfer taking place “because of” Social Security. Unfortunately, this is not a very well understand fact.

We have a government of the rich, by the rich and for the rich!!
Not what Lincoln suggested in his day. The politicians are just the puppets of the extremely rich who really really call the shots from behind closed doors!! Who knows maybe they are pushing all of us to see how far they can go with their raping the working class of America!!

The bottom line is if “Congress” ever put the “MONEY” back where it belongs, we would not have a problem paying benefits. And adding the 2% tax raid only changed my paycheck by “pennies” so the gripe of an increase in the amount “taken” out of my check is minute. BUT CONGRESS PUT OUR MONEY BACK WHERE IT BELONGS and not into the coffers for the idiots in Washington to use.

The only way “investing” the Social Security trust fund surplus might not be considered “raiding” is if every single penny that was removed from the SS trust fund was not only replaced with a US Bond, but also an equal amount of US bonds (not in the trust fund) were bought back from other investors.

In this way, we are simply moving existing debt to the social security trust fund, and NOT GOING FURTHER INTO DEBT!!!!

It is precisely the fact that we go further into debt each time that we consider the fund to be “raided”. The rest is immaterial.

Why are we just talking about it.. Lets fire the thief’s and put real people in the Government and get rid of the puppets that are their for life.

Lets have a Social Security adjustment just like the Congress and Senate has. They don’t even have to tell us anymore how much money they are giving themselves each year.

I’m no genius, but I can see we aren’t doing our part by letting these people stay and represent us. I thought they were suppose to do what the majority of the people they represent wants. That ain’t happening folks sorry to say.

There is a political mindset that has allowed social security funds to be manipulated at the expense of senior citizens. Who gave politicians on both sides of the aisle permission to loot these funds from an insurance policy for our old age? The intention of social security has always been as a safety net to allow individuals a decent quality of life in their golden years.

I have no problem with FICA taxes to provide revenue for social security funding. However, I have a problem with additional federal and state taxing of social security benefits. This is taxing our taxes!

Let’s shore up the Social Security Trust Fund by removing the social security income cap and allowing the wealthy to pay their fair share. The rich don’t need another tax break at the expense of the poor and middle class.

I talked with a Politician, who would know, about the amount of money taken from our Social Security since 1968. He told me the actual amount in “investments:, iou’s and transfers was app $4.2 trillion. Much of these “investments” are for pet projects as paybacks for political contributions, and such as the Green House loans, many of which the government knew were failing, provided monies back to the Democratic party. I then asked him, if these were such solid investments, as President Obama said they were, how much has been taken from your Federal pension and retirement accounts? The answer was -0-. not a dime! I think that should tell you something.

The “politician” you talked to is, if I may so so, full of it. Payroll tax revenues are used to pay current benefits and anything left over is invested in US Treasury bonds. That’s the Social Security trust fund. FYI, it currently amounts to $2.79 trillion. The proceeds from the Treasury bonds are used by the federal government for general expenditures, which could be anything from “pet projects” to education and health care to fighting imperialist wars in the Middle East. If your friend has a problem with this, it’s not with Social Security or the trust fund but with the things Congress decides to include in its budget. As for the wisdom of investing those payroll tax proceeds in Treasuries, what would your friend rather have them invested in? Stocks and bonds? Direct ownership of companies? Lottery tickets? The reason they are invested in Treasuries is because after Social Security was set up, Republican (let me underscore: Republican) politicians were concerned that if they were invested in anything else, the Social Security system would wind up owning a substantial part of the American economy–socialism, in other words. Investing in Treasuries was a way to keep that from happening.
The misinformation and BS that’s been spread about Social Security’s finances is enough to boggle the mind several times over. It’s just par for the course that yet another “politician” is spreading this kind of nonsense. Ah well …

The entire string has been very enlightening. It all goes to show one very basic idea……The United States Government has no business whatsoever in trying to act as a savings account holder for the people for the very reason on display in all of these posts above. It is a colossal shell-game and nightmare. With all of the pushing to raise total earnings that can be taxed (it goes up every year) and all of the pushing to move the retirement age to 70 is 100% ridiculous. People start working in their teen years – 15 for me. And I started paying taxes on those earnings just like everyone else. The average lifespan of a man in the U.S. is just under 76 years of age. So let’s have the average man work all of his life and PAY for 55 years into SS……..so that, maybe, he can draw his benefit for 5.9 years. Does this make a lick of sense? To anyone? It is exactly the reason why the United States Government has no business whatsoever acting as a savings account manager for the people’s money. Want to see an even bigger disaster awaiting us on the horizon? They call it the Affordable Care Act………

Thanks for the comment. With all due respect, however, the system isn’t a shell game (or a Ponzi scheme). It’s pretty straightforward, and the disaster scenarios we hear are exaggerated, for reasons I’ve addressed elsewhere. I haven’t checked your figure on average lifespan, but I’d guess you’re about right. The key here, however, is the word “average.” Plenty of people, if not most, live longer than 76 years. Social Security benefits become more and more vital as people get older. The point is that we (you) don’t know. Social Security is insurance against your assets and other income drying up. Poverty among the elderly would shoot up if the schemes to “trim” and “adjust” it were realized. And guess who would have to shoulder the burden? Their families. Be glad we ave it. Thanks again for your comment.